Chapter 10
Fuse Knowledge to Power

A professional career track


PREVIOUS chapter

NEXT chapter

Book contents











































PREVIOUS chapter

NEXT chapter

Book contents













































PREVIOUS chapter

NEXT chapter

Book contents






Chapter 10

Fuse Knowledge to Power

Excerpt from Rethinking the Corporation

By Robert M. Tomasko



Architects are concerned with flows. When designing a building, their paramount considerations are how occupants will move in it and how light and air will circulate around it. Equally important for organizational architects is how information, know-how, decisions, and careers will flow in the structure being shaped.

When the work of the corporation was primarily the organizing of manual labor, markets were local and slow to change, and the knowledge base upon which competitive success depended was stable, a unitary hierarchy of manager atop manager made a lot of sense. The information needed to run the business was limited and could be easily channeled in one upward or downward flow. Workers did the work, and managers did the thinking.

But this is a reality that has disappeared from most industries. Markets are dimensioned globally, rules change faster than some competitors can master them, and brainpower counts for much more than brawn. Most organizations, though, remain keyed to the old realities. Few hierarchies have even kept up with the need to build in change by linking each of their limited number of levels with the time horizons of greatest importance to the company. Wall Street is blamed for American businesses' preoccupation with the short term, when the problem is just as much a result of inadequate organization structures.

A more serious problem, though, is the lack of rethinking about how a business needs to organize its intellectual capital, its knowledge workers. It is ironic, and wasteful, that while "knowledge workers" (technical professionals and other holders of college and graduate degrees) are making up an increasing proportion of the work force in many industries, the organization structures in which they work remain more the products of the Industrial Revolution than of the information age.

Knowledge, especially that which can affect the company's future competitiveness used to be confined to the research and development lab or to the strategic planning department. Now, as information systems-driven service industries assume a larger share of many economies, knowledge about the capabilities that provide competitive advantage is much more widely dispersed than was ever necessary in traditional manufacturing companies. No single information channel can contain it all. And even traditional product makers are changing. Fewer manufacturing jobs are directly involved in making something; more are concerned with planning what to make, how to make it, and how to keep customers happy after the product has been purchased. As Saab found in its robot-filled plant in Trollhattan, the intellectual demands on front-line workers have increased tremendously. The narrowly skilled assembly job has been replaced by the more knowledge intensive position of the factory automation technician.

Requirements for more intellectual value added have escalated up many organization hierarchies. Networked data bases, expert systems, and an almost never-ending flow of new personal computer software have significantly expanded the scope and the nature of the contribution possible from many mid-level employees. This is not an unmitigated blessing, though. It has also seriously polluted the management role in many companies, making many into high-level doers instead of managers, increasing the role's fragmentations and making it brittle rather than strong and load-bearing.

This situation will only worsen as economic pressures lead to increased management delayering. Companies with eight to ten tiers of management will find it necessary to organize around four or five. The number of subordinates per manager will have to sharply increase. Middle managers will find themselves with less and less time to master these new white-collar productivity enhancers and to make the intellectual contribution their businesses increasingly need.

How have industries that have been traditionally knowledge-oriented organized themselves? Are lessons about the shape of the industrial hierarchy of the future available from the structures used by today's think tanks, consulting firms, universities, and hospitals? Are any practices that have worked well for organizations that employ primarily professionals, such as accountants, architects, and lawyers, relevant to other businesses whose future is increasingly dependent on how they manage the carriers of their intellectual capital?

A professional track, not a track for professionals
The parallel hierarchy in which non managerial careers can develop is called a professional track, mainly to differentiate it from the narrower idea of the "technical" ladder. The word "professional" is used here to encompass all individual contributing knowledge workers, not just members of a select group in traditional professions.

Ironically, this hierarchy is frequently not the best way to structure the participation in the work of a company of relatively self-contained professionals, such as lawyers, physicians, technologists with strong academic learnings, and even behavioral scientists and organization development experts. Using the skills of people in fields such as these can often best be accomplished by treating them as consultants or contractors, structurally reinforcing their independence from the corporation (a key element of the value they add).

Members of many traditional professions argue their work deserves a measure of autonomy from the corporation because it is self-regulating. Self-regulation develops when their role has become institutionalized in society and is associated with:

- A defined knowledge base and a series of routines specifying when to apply what portion of it

-Some formal mechanism for regulating entry to the profession through an accreditation or certification process

- A standard of ethics or code of conduct and the existence of an external body to enforce them

- A professional culture that stresses a duty to use the profession to better society-a sense of mission or calling.

Characteristics like these distinguish professions from other vocations. They are useful qualities, but they can also pose problems for some corporations. To the extent that they build a wall between professionals and others in a company, they can be counterproductive. Many professionals, though, are comfortable with this wall; its existence is incorporated into their routines of practice. Professionals tend to have clients or patients they serve, rather than teammates and colleagues. Traditional professionalism often leads to the creation of hierarchies of expertise, which, observes Abraham Zaleznik, "tend to fragment rather than bond people's relationships."

This sense of apartness had led professionals to play ambivalent roles in many organizations. Mutual suspicions and concerns about trust abound between them and their managers. Some professionals are seen as being much more concerned with their standing in their field than with their position in the company. Resentments form as some outside the professional's field see the person trying to achieve a disproportionate degree of autonomy by hiding behind a professional mystique.

These problems, once just minor annoyances, will become much more troublesome as the proportion of knowledge workers and employees with at least quasi-professional leanings increase in corporate work forces. Such workers' know-how cannot be purchased exclusively on the open market. But the difficulties associated with internalizing it can quickly torpedo the success of a parallel hierarchy if they are not taken into account as the new structure is implemented.

Avoiding these difficulties requires that a bargain be struck between
the corporation and its knowledge workers. The company must recruit knowledge workers who find it attractive to give up a measure of their professional autonomy in exchange for a mechanism that ensures they have more influence over the direction of the business. Providing that mechanism is a key function of the professional track that reaches to the company's most senior management levels. Companies will also have to apply some creativity to make the rewards and recognition provided internally at least as compelling as those provided by the outside profession. Microsoft does this by designating promotion to one level of computer programmer as equivalent to making partner in a law firm. A big ceremony, with attendant hoopla in and outside the company, is provided for those reaching this stage. The objective is to have the employee s tie to the company become slightly stronger than the tie to the field or discipline. A key to achieving this is the provision of incentives that encourage and reward interdisciplinary thinking and a willingness to change one's perspective, not just hunker down in it.

Examples of the Professional Track in Practice
While few companies have fully developed systems that allow non managers to play a significant part in corporate decision making, steps in this direction are becoming more common. Kodak has used senior individual contributors to help fill in the "white space" between product lines. Corning Glass Works has redesigned jobs for its older managers so that they can specialize in adapting existing products to meet emerging customer needs, rather than just focusing on the narrowing competition for senior executive positions. Both 3M and Ford have broadened their technical advancement ladders to include manufacturing and sales professionals.

A fast-food operator created a position called "senior technical advisor" and gave it status equivalent to that of its vice-president for operations. The advisor's role: to serve as a high-level troubleshooter to work one-on-one with franchisees. This job is given to some of the company's best field-oriented talent, people who might otherwise wilt on the vine if moved to headquarters.

This is not an idea limited only to the United States. One of the most innovatively organized companies anywhere. Brazil's Semco S.A., pays its professionals according to their contributions, rather than on the basis of their location in its minimally layered management hierarchy. It is common for Semco's "associates" to earn considerably higher salaries than their managers or even senior executives.

Practices like this will become more common as companies world-wide become aware of how dependent their future competitiveness is upon the creation of structures to accommodate the contributions of their knowledge workers. Their recruiting literature will declare, "You don't have to become a manager to get ahead here." In a business world where, increasingly, knowledge and information equate with power, those who possess these attributes need to join those who occupy the corporation's most powerful positions.


© Robert M. Tomasko 2002

TOP of page

Contact | Biography

Downsizing | Rethinking the Corporation | Go For Growth | Articles

Consulting | Speaking 

Home | Site Contents